Monday, November 08, 2010

Sick Up To Here

Lost Nurse has been an active commenter on BOM posts for a long time, and he/she's had more than enough of our Tesco worship:

"I'm just bored of hearing the Tesco worship. Antibiotic resistance? No problems, Tesco will sort it. Paediatric cardic surgery? It's just like running a cheese counter, you know. MRSA, C.Diff? All this will vanish under private ownership. Even the mounting demographic challenge of elderly care will be eased by two-for-one offers. Apparently."

Now unlike most of us, Lost Nurse is on the frontline. He deserves a properly considered response. Especially since Tyler suspects, at root, we probably agree on the broad thrust of NHS reform.

The first thing is for Tyler to admit that he may be prone to the odd bit of simplification here and there. So yes, Tesco can build a store in 13 days, but no, we don't really think they could build a fully functioning hospital on anything like that timescale. The Tesco vid is brilliant testimony to just what can be achieved, but when it comes to major construction projects we're not really comparing apples and apples. Fair comment.

The second thing is that Tyler's criticisms of the NHS are not meant to be criticisms of everyone employed therein. As we've blogged many times, Tyler's mum was a nurse and he has the utmost respect for the difficult and often stomach-churning work healthcare workers undertake.

For most of Tyler's life, the NHS has been projected as the envy of the world - a shining British success story that brought modern healthcare to all, irrespective of income. There's always been room for improvement of course, but fundamentally we should all thank our lucky stars we weren't struggling with the kind of patchy overpriced healthcare available to Johnny Foreigner.

It's only more recently that we've come to understand how misleading that image is. For one thing, there was healthcare available before the NHS - indeed, Tyler's mum worked in a flagship pre-NHS hospital largely funded by local ratepayers and charitable donations.

More seriously, it turns out that the NHS achieves significantly inferior results to most healthcare systems in other developed countries. Take cancer treatment. Until a few years ago, Tyler had no idea your chances of survival after diagnosis were so much lower in the UK than elsewhere. But they are. Here's a recent summary of the proportion of patients surviving at least 5 years after an intial diagnosis of cancer:

As we can see, the UK has the worst overall survival rate in Western Europe, and is only just a bit better than Eastern European countries, which spend much less than us on healthcare.

Ah, yes, spending.

The traditional NHS defence to criticisms like these is to say that our health outcomes are worse because we don't spend as much money. And in truth, even after the big expansion in NHS spending over the last decade, we still seem to be a tad below the OECD average. When last sighted (2007 figures), average spending on healthcare across the OECD was running at 8.9%, against 8.4% in the UK. And even if we discount the US (on an astonishing 16%), all of the major Western European countries still spend more than us.

So you'd have to say that money could well play a part in our worse health outcomes.

But what does that actually tell us?

It tells us that if you leave healthcare in the hands of national government, you get a system that's resourced not according to what the customers want, but according to what the commissars decree.

Which means the kind of thing we've had for the last 50 years - a destructive stop-go cycle, with alternating periods of feast and famine. Obviously the famines are difficult, but even the feasts are not that great, with vast swathes of cash getting wasted on cost escalation and declining efficiency.

"In Labour's first 11 years, they increased health spending by 138%. But 43% of that disappeared immediately in ludicrous pay deals and other cost increases, and the ONS reckons the volume of inputs only actually increased by 67%. Against that, the volume of outputs only increased by 55%. So excluding those mooted quality improvements, productivity (ie outputs divided by inputs) fell by 7%, or 0.7% pa."

Look, we all accept that in healthcare there is no magic bullet. We all accept that.

But as we've blogged many times, the European social insurance systems do seem to deliver consistently better health outcomes than the NHS. Yes, in the past they have cost more, but what they also offer is choice and competition - the best driver of efficiency yet devised.

Take the highly regarded Dutch system. There, everyone is obliged to purchase health insurance, covering primary care and most hospital care (the poor are state subsidised). The private insurance companies providing the cover cannot refuse to insure anyone on health grounds, and must offer a defined minimum standard package. But they can compete on price, giving them a strong incentive to drive good deals with healthcare providers, and to keep costs low.

But what about Dutch emergency care? As Lost Nurse points out, there's not much profit in that, so how does it work? The answer is that Dutch emergency care is essentially tax-funded. So on that LN is right - emergency care probably has to stay with the taxpayer. Similarly, long-term care of the elderly probably has to remain funded by taxpayers - nobody has really cracked that one yet.

But for everything else, the Dutch system seems to offer a compelling way forward. Choice, competition, and efficiency on the one hand, but universal coverage on the other (ie no US-style dropping through the net).

And our guess is that there are far fewer lost nurses in Holland. Far fewer victims of commissariat blunders and middle management bullying. And there are certainly far fewer inquiries into deaths from hospital acquired infections.

PS In deference to LN we intend to lay off the Tesco comparisons for a while. But we can't promise to stay away for good.

BOM the book now available

Drawing on six years of blogging government waste, this book shows how we spend far more than we need on our public services. It sets out the facts and explores the underlying issues. Just why does government spend so much and deliver such second rate service? Why do we put up with it? And what are the alternatives?

ABOUT BOM

Despite all the talk of cuts, government still consumes nearly half our national income. Yet many tens of billions of its spending is wasted, with taxpayers made to pick up the tab for a depressing array of overpriced sub-standard services. This is money we can no longer afford, and our National Debt is already at danger level.

If we're to avoid further decades of stagnation and austerity we urgently need to find another way. Exposing and understanding the wastefulness of government is a necessary step in the right direction.